Infosys Watchers Oblivious as the Biggest Story of 2012 Unfolds

In my post yesterday, "Biggest Story of 2012: Implosion of H-1B Business Model," I promised to provide some additional examples that demonstrate how Infosys watchers, especially those in India, are so captivated by Infosys' power and influence that they're being blinded to the one development that will have a more dramatic impact on the future of Infosys and the Indian IT services sector than any other: the U.S. government's determination to bring Infosys to justice for rampant visa and tax fraud.

Let's begin with a Dec. 19 interview conducted by India's Business Standard with Kris Gopalakrishnan, the co-founder and executive co-chairman of Infosys who was CEO of the company when Infosys employee and whistleblower Jay Palmer filed his civil suit alleging visa and tax fraud, and the U.S. government began its criminal investigation of the company. Almost incomprehensibly, the interviewer asked absolutely nothing about the unprecedented legal challenge that Infosys is facing in the United States, which arose under Gopalakrishnan's watch as CEO. Instead, the interviewer lobbed softball questions about IT budgets and capacity expansion, enabling Gopalakrishnan to maintain the charade that the outlook for Infosys is rosy.

Then there's the equally incomprehensible and strikingly oblivious continuation of the myth that Infosys is a model of ethical corporate behavior. On Dec. 16, Beech Tree Associates, an ethics training outfit in the UK, posted an article titled, "Ethics and Competitiveness - The Double Business Case," in which the author cited Infosys to make his case about the value of business ethics:

What you do not hear so much about are the businesses that are doing well from a long term strategy and respect for business ethics. These companies are not so much "playing by the rules" rather they are "writing the new rules" and living by them daily in an uncompromising way. Infosys is one such exemplar company that I have written about before. An Indian IT services company founded on ethical principles, it has flourished for over 40 years; and no one can argue with its impressive business results. This is an excellent example of the positive business case for ethics (+PBC).

The irony is that the author was largely accurate: It is very much the case that instead of "playing by the rules," Infosys is "writing the new rules and living by them daily in an uncompromising way." The author apparently has no clue that the new rules Infosys is writing and living by constitute the absolute antithesis of ethical behavior, with visa and tax fraud a core element of its corporate culture. It's mind-boggling that an outfit whose reason for existence is to provide training in business ethics could have allowed itself to guzzle the Infosys Kool-Aid with such relish.

And then we have a Dec. 29 story posted on the website of NDTV Profit, a media outlet in India, headlined, "Corporate Succession: Inside Two Biggest Stories of 2011." According to these folks, the two top stories of 2011 were the leadership changes at Tata Sons and Infosys. The story recounted how former Infosys board member Mohandas Pai criticized the CEO selection process of the company, as if that somehow helped to substantiate the selection of the leadership change at Infosys as one of the two biggest stories of the year. There was, of course, no mention whatsoever of the visa and tax fraud scandal in the United States that these leaders were quietly dealing with as they passed the baton.

Perhaps most inexcusably oblivious of all was an analysis of Infosys' business outlook conducted by Sudin Apte, principal analyst and CEO of Offshore Insights Research and Solutions in Pune, India, who has reportedly been tracking Infosys and the Indian IT industry for 15 years. Apte's analysis, which appeared on the website of Forbes India on Dec. 19, was pessimistic about what lies ahead for Infosys. It cited faded strength over other companies in account management, client relationships and account mining. It referred to slow decision-making and a paucity of clients that have bought Infosys' stories on new technology initiatives. It mentioned unhappy Infosys customers who are dissatisfied with the low number of employees it assigns to their projects. It noted that Infosys' net margins are 50 percent of what they were 10 years ago. But it said absolutely zero about anything that relates in any way to what Infosys and the Indian IT services sector stand to lose as a result of the U.S. government's sweeping criminal investigation of the company. This guy's entire professional life is wrapped around Infosys and the Indian IT services sector, and yet he's clueless about what's happening behind the scenes in the market where Infosys gets two-thirds of its revenue.

Perhaps it's the case that Infosys is seen as too big and too powerful to be hurt in any meaningful way by whatever actions the U.S. government takes as a result of the criminal investigation. Perhaps visa fraud is seen as a standard business practice that doesn't warrant any substantive attention. I have a feeling that a lot of that is about to change, and that this case is going to get a whole lot more attention than it's getting now. There are people within Infosys who know what I'm talking about. Stay tuned.

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"It's mind-boggling that an outfit whose reason for existence is to provide training in business ethics could have allowed itself to guzzle the Infosys Kool-Aid with such relish."

That's more common than not. Since the beginning of the hard core H-1b era in 1998, I've noticed that much of the world worships winners, and hates losers, even if the losers lost because the winners cheated them. They will then cheer on the winners, believing that it's 'best for everyone' if they win even more, even if they have to cheat others (who arent counted as part of 'everyone') more to do it.

Since 1998, I've seen, with few exceptions such as Senator Grassley, and now you, Don, and Pat at CW, any recognition that I am a player in the equation with any legitimate interests, even though the industry was largly built by guys like me. So of course having the people who built the industry ground down to working standards equal to indentured servitude (on of the first things outlawed in this country) doesn't bother them in the slightest, and they want more of it.

This 'business ethics' firm is completely consistent with that. There's nothing unethical about cheating a disenfrachised non-entity, in their book

Hi Don, I must admit I am a little bewildered by comments the Palmer issue has had no effect in India. Several articles in the Indian papers are focusing on visa issues facing Indian "High-tech" companies.

I have seen several recent ones even mention Palmer by name. I am googling from Europe, so perhaps some filtering is somehow occuring on your end.

Here are just a few signs of things to come ( some very interesting comments on the first article ):

It's very true that the Indian press has been writing about the case, but a lot of it is nothing more than regurgitations of my posts (with no attribution), and the rest is generic reporting with almost zero analysis. The point of this post is that Infosys watchers, especially in India and including the Indian media, are only giving the case a fraction of the attention it warrants. Why aren't the executives being grilled on the case in media interviews? Why aren't the industry analysts all over it?

"but a lot of it is nothing more than regurgitations of my posts (with no attribution)"

Interesting how in journalism, plagiarism is a cardinal sin (routinely violated by the Indian press who seem quite adept at Ctrl-C/Ctrl-V journalism) and those caught violating that rule (at least in developed societies) are mercilessly punished.

The equivalent of plagiarism in the software world is software theft, however there is no stigma in countries like India and China to stealing IP. I believe it was New Zealand that had more licensed copies of Windows than China (a small nation in comparison), but the OS is installed on some 120 million desktops in China. There is also astronomical piracy rates in Indian companies as well.

Not exactly in parity with the H-1b/B-1 visa issue we are currently discussing, but I believe that IP theft is going to become a greater issue this year and will impact Infosys negatively.

It is mind boggling how Don gets to go on and on about a company he knows nothing about. All Don can do is bitch about Infosys. I have been a customer for Infosys and I had another company also providing services at the same time. I have seen that Infosys takes a lot of care to adhere to laws, rules and regulations. The other company were sending people by taking advantage of some loop holes, but Infosys never did. We have one case of Jay P and everything what Infosys does is not right? Come on! Give me a break!

"The other company were sending people by taking advantage of some loop holes, but Infosys never did. "

And you of course reported this to the authorities, did you not? If you didn't, it's people like you who are a major part of the problem. Make that call George, or shut up. The government should revoke the visas of any worker they discover knew about abuse and didn't come forward. A policy like that would change everything.

We aren't talking about just Jay Palmer. There are other witnesses, some from HR, who have come forward. And based on what I've heard we aren't talking just about Jay's team at a single client. We are talking about a pattern of behavior.

If you've proven anything George in your last comment, it's that this isn't some isolated thing that only Infosys does. It's really a standard offshore outsourcing industry practice, and even a practice at major American corporations. If it's not Infosys, it's another company.

Make that call George. Or email Don privately - I'm sure he would protect your identity. There are things you can do other than whine about Don "unfairly targeting Infosys" while in the next breath admitting that you outsource work to a company that uses loopholes to gain work here.

"but a lot of it is nothing more than regurgitations of my posts (with no attribution)"

R.,

All the NEWS items which comes here in Don's "reports" come to Indian and other media way before Don writes it here. Sometimes even other blog writers write it before Don and Don threatened them to stop advertise here in his blog impacting his bread and butter.

Now the only thing which Don writes which you won't find anywhere else is telephonic conversation with Palmer's attorney. Real journalists doesn't have low life to do such works. Think twice and learn about it before you use the word like Journalism. If Don is a journalist then the same way probably you are an Activist.

Yeah, there are several inconsistencies when it comes to Infosys. I have followed founder Narayanamurthy for several years (since I was teenager growing up in India). I am yet to see him say anything pompous or inappropriate. He is an extremely modest man and quite the philanthropist. His family is, as such, a bunch of high achievers including one of Cal Tech's most prominent astronomers.

That said, I have a friend who works for Infosys on an H-1B and has been with them for 12 years. He is suitably challenged with high quality work here (starting off with IT while a young employee, he's now into core business management resembling consulting and investment banking). However, he claims that he is extremely underpaid. I know he has horrible work-life balance (he puts in 15 plus hour days regularly). He also is an incredibly good guy. I believe him when he says that he's underpaid. More seriously, I also see how Infosys can then afford to offer cheap services to its American clients because they have the advantage of low labor costs.

At the end of the say, companies like Infosys have been a huge factor in helping with India's progress over the last 20 years. They've provided a lot of employment for India's graduates, but maybe this has been at the expense of the US's graduates? It's now becoming apparent that this has not been without costs. Jay Palmer and my friend have been collateral damage and I think Infosys has to be answerable.

My view is that if Murthy was the essence of ethical behavior he purports to be, he would have seen to it that Jay Palmer's whistleblower complaint was handled in accordance with Infosys' stated whistleblower policy, and that the fraudulent behavior Jay outlined was immediately corrected. Murthy did nothing, nor did his fellow executives. Consequently, Jay had no choice but to file a civil suit, which in turn led to the federal government's criminal investigation. Let's be charitable and assume Murthy knew nothing about what was going on with respect to the visa and tax fraud. That reflects very poorly on his competence, but it's forgivable. The fact that he lacked the strength of character to do the right thing when Jay blew the whistle is not. Murthy could have prevented all of this -- no one outside of Infosys would have even known about it. Now, Infosys will face the consequences of the U.S. government's criminal investigation. He and his cronies have allowed Infosys to take a shameless path of denial and retaliation against Palmer, and it's all going to backfire on his company to a degree that very few people so far realize.

"Now the only thing which Don writes which you won't find anywhere else is telephonic conversation with Palmer's attorney. Real journalists doesn't have low life to do such works."

So just so I understand you definition of "real" journalist . . . a journalist who actually asks questions of people involved is considered "low-life". I suppose a classy journalist would simply make up the facts? Or just provide their opinion without anything to back it up?

Don has asked Infosys for their side and last I checked they said "no-comment". Maybe he should call again? My guess is it would be a wasted call because their response will be the same.

I can understand your confusion. What we have come to understand as "journalism" is really just talking points that we get to hear over and over again while we watch the same commercials on TV over and over again, and the mainstream media's real goal is just to entertain us so we don't change the channel.

"If Don is a journalist then the same way probably you are an Activist."

Because people who are activists and actually care about the world around them are bad - right? It is much better when people sit up, watch TV, and say baaaaahhh like the sheep they are? Would it make me a better person if I would believe whatever the media tells me and to, smile, pay my taxes, and let our elite "masters" do whatever they want?

The reason powerful people are able to do bad things is because the vast majority of people on this planet are willing to bend over and take whatever they have coming. If Jersey Shore doesn't get them through the day, drugs like Zoloft will.

People start out by believing the best in others and that they are honest in how they represent themselves. Atleast I do. But from what you say, it looks like you should be completely distrusted from the start. Point taken.

Without knowing anything about your work I have no reasons to not believe you. So I agree to whatever you say.

But everyday you do exactly opposite. You just wake up and without knowing anything about something start giving your expert opinion just to fulfill your one point agenda. You are just like any other extrimist.

You remind me somekind of brainwashed extrimist terrorist whose onle belief from bottom of heart is to hate something and then entire life and actions dedicated to keep up that. Just that your way of actions are not path of terrorism. You have very wrong feeling about being logical as all such extrimist groups have. No one can change your type. So best of luck for many more 1000 liner comments on thousands of Don's "Reports" to come in future. Hope you keep on getting more and more enlightened by Don's expert journalism.

You gave this worked till 2am lecture many times in past whenever similar questions came :P

Now the point is - it is very clear you are kind of guy who is asked deliver 1+2=3 by end of tomorrow and you just do that in your own time. You are not part of any bigger plans, you don't have a team, you need to drive anymore people under you to make sure delivery in efficient manner, overall you get the point (at least whoever can get it they got it). Then why you open your big mouth as if you know what CEOs should do.

Giving 10 points lecture on what should be followed like Don does in his other posts by copying those 10 points some book is different thing. Nothing wrong in it but don't behave like you know all and be in your own boundaries.

More trouble for Infosys now after the half a billion dollar scam. See the article below.

Half a Billion dollars client swindle by Infosys

-

First to set a context. Infosys mandates its employees to clear 2 exams every year. The exams are based on study material prepared by Infosys. This is referred to as "certification". Due to cost constraint Infosys has very limited number of subjects for which exams are given. Even if employees are not working on a particular area, the organisation mandates them to take the exams on those areas, irrespective of their current and visible area of work. Officially the organisation admits that every exam requires a study time of 45 hours.

The following article shows how Infosys has been charging it's clients for the past few years for time spent on the internal work of Infosys. It has been charging it's clients to increase it's knowledge valuation.

Infosys mandates having its employees do two certifications every year. Certifications are exams set up for subjects which a lot of times are not related to client work. To attempt two certifications an employee needs to spend a study time of more than two weeks. Infosys certification departments officially admits that ever certification takes 45 hours of study time. This means half a man month every year. Infosys goes to the extent of penalising people in case they do not complete these certifications ensuring pressure on employees to complete certifications.

This does not reflect in the billing of clients every year. Clients are given no discount every year although this time is spent in non-client work.

For onsite people this could be a violation of visa rules in some countries. Because the visa allows people to do only client work onsite and no other work. This work of half a person month is substantially high so it cannot be considered a miscellaneous activity.

The organisation can claim that all certification study is not done in office hours. This is not true as most people do this in office time. In case they were doing this in non office time then it would mean they do not have a weekend for 5 weeks which is not true. The same is applicable for onsite people, they are doing 2 weeks of non-client work on a client work visa. Even if organisation is claiming that this is done out of office hours, in some states and countries this is a violation of visa norms and work hour compensation norms.

The financial impact calculation is defined below. The numbers are conservative and collected from the annual report and other genuine sources on the Internet. Some of the numbers could be higher in reality.

Average number of employees over the past 5 years = 100,000

Average billing rate = $18

Average hours billed per working day = 8.75 hours

Working days per month = 20 days per month

Time spent for 2 certification for just one attempt in the year= 0.5 months

More trouble for Infosys after the revalation of the half a billion dollar scam

Read the article below.

Half a Billion dollars client swindle by Infosys

First to set a context. Infosys mandates its employees to clear 2 exams every year. The exams are based on study material prepared by Infosys. This is referred to as "certification". Due to cost constraint Infosys has very limited number of subjects for which exams are given. Even if employees are not working on a particular area, the organisation mandates them to take the exams on those areas, irrespective of their current and visible area of work. Officially the organisation admits that every exam requires a study time of 45 hours.

The following article shows how Infosys has been charging it's clients for the past few years for time spent on the internal work of Infosys. It has been charging it's clients to increase it's knowledge valuation.

Infosys mandates having its employees do two certifications every year. Certifications are exams set up for subjects which a lot of times are not related to client work. To attempt two certifications an employee needs to spend a study time of more than two weeks. Infosys certification departments officially admits that ever certification takes 45 hours of study time. This means half a man month every year. Infosys goes to the extent of penalising people in case they do not complete these certifications ensuring pressure on employees to complete certifications.

This does not reflect in the billing of clients every year. Clients are given no discount every year although this time is spent in non-client work.

For onsite people this could be a violation of visa rules in some countries. Because the visa allows people to do only client work onsite and no other work. This work of half a person month is substantially high so it cannot be considered a miscellaneous activity.

The organisation can claim that all certification study is not done in office hours. This is not true as most people do this in office time. In case they were doing this in non office time then it would mean they do not have a weekend for 5 weeks which is not true. The same is applicable for onsite people, they are doing 2 weeks of non-client work on a client work visa. Even if organisation is claiming that this is done out of office hours, in some states and countries this is a violation of visa norms and work hour compensation norms.

The financial impact calculation is defined below. The numbers are conservative and collected from the annual report and other genuine sources on the Internet. Some of the numbers could be higher in reality.

Average number of employees over the past 5 years = 100,000

Average billing rate = $18

Average hours billed per working day = 8.75 hours

Working days per month = 20 days per month

Time spent for 2 certification for just one attempt in the year= 0.5 months

It is ironic that you are questioning Don's journalist qualifications for writing about an industry that has created a whole new industry of faked degrees and experience to support itself. You would be better served questioning those "lowlifes" about their qualifications.

"Dear Mr. Tenant..." or "I understand you want to interview us regarding our use of H-1b and B-1 visas. When can we meet?". Call me crazy, but something like that.

"Who is Don by the way?"

........

>>>>>>>>>

See in entire discussion your pain point is why Palmer's attorney talks to Don (or Don talks to him ..whatever) and why Infosys doesn't talk to Don.

This is the same reason your Government DOJ, DOL not listening to you doesn't matter how loud you shout.

Once you grow up in value chain and start understanding how organizations work or at least know how employees are maintained in an org, you will understand these things. Have you ever got a mail from your employer educating you that you should not open your mouth to media about your company? Do you really understand how a billion $ company behaves different from an individual.

It is like I'm cribbing because Obama did not reply back to my letter to him last month.

If you think Infosys is guilty because they are not talking and providing material for Don's blog then probably they will happily agree they are guilty. Unfortunately you are not given any credibility to judge this case. So you can just carry on your activism here in comment sections.

This is the same you, who wanted Infosys policies in a word doc and published here. You want Infosys CEO to sit and spend 1 hour talking to Don, you want Hillary Clinton to spend 90% of her time in India visit to talk about Palmer case, you want DOJ, DOL SEC all spend their 95% time to protect your software engineering job day in and day out. These are the things makes you laughing stock to certain sections of the readers and also hero to a certain section.

Well, you're learning well from the mass media how to marginalize people when you can't really debate them on the merits. Even managed to get the word "terrorist" in. Nice. Do they teach character assasination at Infosys or are you a freelancer?

If you have a legitimate point to debate, I'm more than willing. It seems you would rather attack my character so any further discourse with you will lead nowhere unless you start using a bit more tact.

"Once you grow up in value chain and start understanding how organizations work or at least know how employees are maintained in an org, you will understand these things."

I'm glad you cleared that up for me, since I just fell off the turnip wagon yesterday.

"Do you really understand how a billion $ company behaves different from an individual."

Yes, they are way more arrogant.

Companies and individuals who come from a culture of corruption correctly assume that they can get away with quite a bit in the US. They can exploit many loopholes and disregard many laws for a time - and usually a substantial amount of time. And they usually make good money in the process.

Our country will give you plenty of rope to hang yourself and your company. Look at Bear Stearns, Enron, HealthSouth, and in your vertical and nation there is Satyam. Infosys isn't immune from scandal, especially when it is a scandal in their largest market involving their primary means of competing in that market (labor arbitrage dependent on circumventing visa laws, that the public is pressuring to change).

When push comes to shove, Microsoft and the other big American companies dependent on foreign labor are going to throw Infosys and the Indian companies under the bus. They are going to say "it's those Indian companies, not us".

I think that American companies are definitely part of the problem, but in this economic/political climate the government must act, especially following any conviction of the biggest player in the game. You guys are easy targets.

The writing is on the wall. Indian companies were the most egregious violators of the rules, and they are the easiest target for punishment. They can't vote, they can't donate to political campaigns, and when constituents are barking about jobs going offshore and cheap foreign workers coming here do you think they go after Microsoft or Infosys?

You brought up the word "value chain", so hopefully this helps you understand just where Indian companies stand in the value chain as it relates to the American government. India isn't really even a strategic ally from a military perspective, so you don't have that going for you either. And trade? Well, we run massive trade deficits so India has more to lose than we do.

Indian companies have been the fly in the political ointment and made it politically easy to make the H-1b visa a scandalous issue. Microsoft actually pays their workers what appears to be market wages or higher - Infosys, Wipro, and Tata? Just the opposite bottom of the barrel wages. Thanks to you we can argue that the H-1b visa helps offshore jobs - because clearly that's what the top sponsors (primarily Indian companies) use it for. We can argue that H-1b workers are suppressing American wages, and replacing American workers.

Indian companies are a political liability for American companies who want to continue riding this gravy train. They'll turn on you like a pack of wolves. So let this be a lesson - if you live in the grey area of the law you are sure to die in the grey area of the law. You guys should have been model citizens for responsible use of the H-1b visa since you are the most vulnerable when it all falls apart.

Like Don said - it's a business model. You aren't protecting your business model, rather setting the stage for its collapse because of the shenanigans. That's the problem with greedy people - they let their greed surpass their business interests. They are a danger even to themselves.

"Once you grow up in value chain and start understanding how organizations work or at least know how employees are maintained in an org, you will understand these things."

I'm glad you cleared that up for me, since I just fell off the turnip wagon yesterday.

"Do you really understand how a billion $ company behaves different from an individual."

Yes, they are way more arrogant.

Companies and individuals who come from a culture of corruption correctly assume that they can get away with quite a bit in the US. They can exploit many loopholes and disregard many laws for a time - and usually a substantial amount of time. And they usually make good money in the process.

Our country will give you plenty of rope to hang yourself and your company. Look at Bear Stearns, Enron, HealthSouth, and in your vertical and nation there is Satyam. Infosys isn't immune from scandal, especially when it is a scandal in their largest market involving their primary means of competing in that market (labor arbitrage dependent on circumventing visa laws, that the public is pressuring to change).

When push comes to shove, Microsoft and the other big American companies dependent on foreign labor are going to throw Infosys and the Indian companies under the bus. They are going to say "it's those Indian companies, not us".

I think that American companies are definitely part of the problem, but in this economic/political climate the government must act, especially following any conviction of the biggest player in the game. You guys are easy targets.

The writing is on the wall. Indian companies were the most egregious violators of the rules, and they are the easiest target for punishment. They can't vote, they can't donate to political campaigns, and when constituents are barking about jobs going offshore and cheap foreign workers coming here do you think they go after Microsoft or Infosys?

You brought up the word "value chain", so hopefully this helps you understand just where Indian companies stand in the value chain as it relates to the American government. India isn't really even a strategic ally from a military perspective, so you don't have that going for you either. And trade? Well, we run massive trade deficits so India has more to lose than we do.

Indian companies have been the fly in the political ointment and made it politically easy to make the H-1b visa a scandalous issue. Microsoft actually pays their workers what appears to be market wages or higher - Infosys, Wipro, and Tata? Just the opposite bottom of the barrel wages. Thanks to you we can argue that the H-1b visa helps offshore jobs - because clearly that's what the top sponsors (primarily Indian companies) use it for. We can argue that H-1b workers are suppressing American wages, and replacing American workers.

Indian companies are a political liability for American companies who want to continue riding this gravy train. They'll turn on you like a pack of wolves. So let this be a lesson - if you live in the grey area of the law you are sure to die in the grey area of the law. You guys should have been model citizens for responsible use of the H-1b visa since you are the most vulnerable when it all falls apart.

You aren't protecting your business model, rather setting the stage for its collapse because of the shenanigans. That's the problem with greedy people - they let their greed surpass their business interests. They are a danger even to themselves. Reply

But then if you think people who are in visas are all here because of fake degrees and experience then either you are a big dumbhead or your entire industry and political leaders are much much more dumber than you to embrace entire system.

You seem to know so much about so many things. You are just too good! Is there any topic you don't know or cannot comment on? I doubt it! Just amazing looking at you go on and on, man! your analysis of the situations are impeccable! I can go on and on about you, but, will stop. I am sure you get the message!

I don't really see this as a H-1b visa violation (maybe a B-1 violation though - or at least questionable). Clearly training and continued education is part of working in our field. It's really more of an issue between Infosys and their clients and whatever they have agreed to in the contract. If clients weren't aware that they would be billed for training Infosys staff, that is a scandal.

I believe that companies should pay for their employee training and if a consulting firm has a long engagement the client needs to be part of that. If the training is related to work the client is doing, it is probably smart to include training in the contract. A well trained worker will usually very quickly provide a return on the investment so it could be to the client's advantage.

But, that all needs to be agreed upon and done with the client's knowledge. If this is true and clients are getting billed for hours that should be non-billable, billed under false pretense, or not agreed upon previously that is a scandal. It's a scandal that can be handled in civil courts most likely and a bad business practice - that could cost them future business if true.

How do you expect Infosys to respond to somebody like Don? Who is Don by the way? He talks as if he is an authority on the subject, but clearly he is talking on behalf of Jay! He does not know all the facts and he titles this "the biggest story". Come on guys! Get a life!

"None of this is really news. If this was really newsworthy then we would be reading it in the NY Times, Washington Post and having it broadcasted on CBS, NBC, ABC.PBS, FOX."

I see. The mainstream corporate media decides what "news" is. So the Zoey and Ben (who?) divorce is more important, as is the 17-14 lead Clemson took in the first quarter (all Google news headlines at the time of this posting).

As I recall, these are the same outlets whose fine investigative journalists failed to reveal that the government's call to war in Iraq (WMD) were based on wrong information. The British beat us by months. Colon Powell's yellow vial of baby powder - all the evidence Americans needed.

When Osama was planning the 9/11 attacks, remember what we were talking about at the time? Garry Condit and an intern.

Sorry, but the media doesn't dictate to me what is newsworthy. They decide what is entertaining enough to keep morons glued to the TV guessing which celebrity is getting divorced next or which NFL player used a dirty word on the field. You know, "news".

During the financial sector collapse in 2008, the media gave no warning - instead we were talking about John Edwards and his affair just a week prior. That was "news".

In 2005-2007, Bear Stearns was recognized as the "Most Admired" securities firm in Fortune's "America's Most Admired Companies". That was "news". The media dutifully reported after the fact that the company was over-leveraged and were genuinely shocked - because they didn't see it coming.

The closest thing to news in your list is the Times and WAPO - and they are now a shadow of their own glorious past. Rarely will you find news on television. You will find big breasted women, big chinned men, and talking baboons with enough fake body parts to make a stripper blush.

Investigative journalism is a hobby now, or something bloggers do. If it has entertainment value - like the idiots on "To Catch a Predator" or "Cheaters" - maybe the media will invest their money in it. "Real" journalism as you call it amounts to copying press releases and parroting statements from CEOs and politicians as if it were from the mouth of God. "Real" journalists - and Don has identified a few - copy and paste what other journalists say, and never ask tough followup questions.

"Real" journalists do Maddoff prison interviews after the storm, instead of hard hitting expose's on his pyramid scheme years before all those retirees lost it all.

If you haven't figured it out by now, you set off a spark in me. I don't want journalists to report the obvious. I know it's raining you morons. If I care who won the game, I'll look in the sports section - not the front page. I don't want you to show me the terrorists flying into the towers as it happens. I want to see terrorists rings uncovered before it comes to that. I don't want to wait for some whistle-blower to put his career on the line reporting corporate fraud - I want journalists exposing what really goes on before it becomes a standard business practice.

We are witnessing the failure of America. It's not because we have greedy CEOs or corrupt politicians. We've always had that. It's because the watchdogs of Democracy - journalists - has been neutered. Reply

It's a propaganda machine designed to manipulate, not report. It's a consortium where 90% of the media we digest today is owned by seven media magnates.

It's an organization that says "how dare you Ron Paul, Dennis Kucinich, and Ralph Nader - thinking you can step up to corporations!".

It's an organization that zooms in on the anarchists at a protest, not the dad pushing an infant around in a stroller with a baby bottle in one hand and a sign in the other.

The news needs to stop telling us what happened, and tell us what is happening. We know what a war looks like. We know what financial meltdown looks like. One guy packing his cubicle up looks similar to the other guy packing his cubicle up. One guys kissing his wife and going to war looks just like the other guy. How many times do we need to watch this stuff until we start asking ourselves "what events lead to war" and "what events lead to financial meltdown"?

I'm sure you're not surprised to hear that the financial sector is still "too big to fail". Front page news? Nope. Yesterday's news. And tomorrow's news, since the problem wasn't fixed. And those baboons on TV will once again look puzzled and ask "what just happened"?. What just happened and what keeps happening is that the media stopped working. The guard dogs have been replaced with AP wires, and cut-and-paste jobs of the few remaining journalists who still know how to type.

I happen to think there are still good journalists remaining. They aren't paid nearly enough, and they aren't on the front page. The "not-so-real" journalists like Julian Assange who actually uncover the world's dirty secrets - become targets for assassination. If the NY Times were credible, they would be digging through wiki-leaks and they would have front-page stories until the end of time. They would be rushing to Assange's legal defense, not distancing themselves from him. What he did is no different than deep-throat. Bob Woodward and Carl Bernstein are American heroes! Assange should be celebrated as a hero also.

Frankly, I'm tired of writing about this. I'm tired of trying to inspire the few people willing to listen. I wish there were more hands-on approaches that would have positive outcomes - and that was within my power. I'm not sure if I want to work within the government or with some other organization - but I would like to find better use of my time and see measurable results. Unfortunately, nobody (to my knowledge) gets paid to fight the status-quo. Most people who do that are marginalized, or worse.

The only argument you've made in this entire thread George is that Don is a spokes person for Jay and that us "little people" have no right to question the great Infosys or expect them to comment on their behavior.

I disagree with both points. In Don's blog, he is entitled to an opinion and there is a different standard than articles. Infosys isn't talking, Jay's lawyer is. There is content to write about and he does. Infosys knows what they can do if they want their side told.

Usually a billion dollar company will put their PR team to work and come out with some good spin. They've been really quiet, so this appears to be more of a legal/criminal issue than a marketing issue. Legal is running the show, not marketing.

I understand why they aren't talking. It's probably a smart legal move. But while they are up against the ropes I'm more than happy to throw jabs. They would do the same to me. They were more than happy to libel Jay - at least my comments are based on the truth as I know it.

What they said about Jay was designed to destroy him, and their abuse of the system has hurt many American technology professionals. I take no pity on Infosys and as long as all my punches are above the belt I see no reason to stop punching.

100% non-billable. I hope you're not talking about me because I have never said I bill for hours when I'm relaxing or surfing the net.

I was up at 2am last night working, so this is me unwinding on my own time. Also, I'm accountable for all work produced and the client is almost always happy with the output. When the client isn't happy, I make them happy.

I can defend my work ethic because I always give more hours than I bill for. I round down, not up.

"Dear Mr. Tenant..." or "I understand you want to interview us regarding our use of H-1b and B-1 visas. When can we meet?". Call me crazy, but something like that.

"Who is Don by the way?"

A blogger and journalist. Perhaps if he was worth a quarter billion like Thomas Friedman he would be a more reliable source? Is there something special Don lacks to be considered a journalist? Some birthright?

"He talks as if he is an authority on the subject, but clearly he is talking on behalf of Jay!"

Name me a journalist who has written more on the subject. I'm sure Jay and his attorney would dispute that Don speaks on their behalf.

"He does not know all the facts and he titles this "the biggest story". Come on guys! Get a life!"

That's because they aren't talking. The guilty tend to do that - and lawyer up. It's a big story. If Infosys faces serious charges, it could be "the biggest story" this year and perhaps this decade. We've seen plenty of giants fall. Scandals tend to have that effect.

Infosys may not fall, but their "business model" of exploiting lower paid foreign workers while disregarding more expensive local workers is in jeopardy. I'm sure Wipro and Tata will enjoy a competitive advantage for awhile, until new laws are passed. It could be a pivotal moment in the history of offshore outsourcing.

"This stuff has been going on for 20 years and I don't see any signs of a change."

The Internet is the "change" and equalizer. Currently, most people still look to television for the news. There is still plenty of biased news online and plenty of wrong news, but overall people who use the Internet as their primary source of information are going to be far more informed than people who just watch television. If anything, television will steer you in the wrong direction.

It won't change overnight, but I think that eventually the Internet will be the primary news source. The barrier to entry is much lower so it will be harder for media outlets to monopolize (search engines however...).

I personally think that journalists should band together and create their own media outlet online, considering how many of them could use work right now. Open source journalism, but with very strict professional standards. I would be willing to pay a premium for unbiased reporting and investigative journalism.

A long winded diatribe with odd CAPITALIZATION. But anyway, here's the deal... we can go on about all the various inequities but the specific case in point is that Infosys is breaking the rules. Guest workers are fine as long as the rules are followed. You seem to have missed the point that Infosys is committing a crime.

Using your logic then Indian citizens were also responsible for letting themselves get colonized by the British and all the resulting hardships and famines that resulted. All started with a little trading company called the East India Trading company... Yes I know some history too.

This is the difference between the knowledge which comes from global exposure and by giving respect to others opinion compared to the Lawson's knowledge which is totally dependent on google search and wikipedia. Dangerous part of google search is that you will never get a complete picture as you will read what you want and not necessary what is correct.

After reading this wishlist in "the Biggest Story of 2012" and some folks echoing the excitment (yey! all our dreams will come true), Hulk angry.

Hulk realizes that some people still live in this utopian lala land. This is the same hope 'n change garbage we fell for a few years ago and where are we now? Goldman execs still in the feds, GE and powerful lobbies still using loop holes, clueless politicians supporting SOPA and pandering to powerful lobbies. Both sides of the political divide supporting more work visas.

Please. Wake up.

Here is what will happen as per the incredible Hulk's analysis:

1. Infosys will be found guilty however they will defend themselves showing that this was an isolated case of rogue managers as they have existing processes and controls. See what happened to other companies that were found guilty such as Patni (where GE has a majority stake) or TCS.

2. Infosys will pay a huge fine which they can easily afford with their cash reserves.

3. Infosys is already hiring folks from the US so they're preparing for an eventual guilty verdict.

4. Visa process will be more strict with a lot more scrutiny

5. Companies will find work arounds with or without visa restrictions or scrutiny. They don't pay hundreds of thousands of dollars to hi calibre people for nothing you know.

In short, the consequences will be lot more watered down than what most of the sensationalists over here want to believe. It will be just a bump on the road for these outsourcing firms. Yes, a bump on the road. Nothing more. Tada.

This is without mentioning the possibility that palmer will go for an out of court settlement even if the Federal prosecutors go ahead with their investigation. The prospect of getting a retirement bonanza along with a cut for Medelson must surely be tempting.

This is a blog. We are passing our judgement on Infosys here. Just as much as you are expressing yours. Right now the Indian government is passing laws expecting Facebook, Google, Twitter to expunge "objectionable material" that is not favorable to them. You seem to expect the same sort of thing here. It is not as though what is said here, either positive or negative will have any effect on Infosys.

Have you heard the saying "you buy your ticket, you take your chances" ? The guest workers signed up with their sponsoring bodyshops to come here. They weren't exactly kidnapped and brought here. Well I admit I don't know Indian recruiting techniques. They are free to leave.

Unlike India, where legal cases take 20+ years or never to be settled, Indian employees can take employers here to court too. If you feel you are being cheated you can file the legal instruments. But there you go "passing judgement" on American employers. Something you accused us about. Ironic eh ? Brilliant.

OK, here's the deal. I'm no longer going to tolerate personal insults in my blog. For a long time, my inclination was to bend over backwards to keep this a completely open forum so that everyone's views could be fully and freely expressed. Unfortunately, that effort has been so rampantly abused that I've decided to end it. So I will no longer tolerate ANY personal insult, whether it's directed at me or at another reader. If your comment contains a personal insult, it WILL be deleted. Feel free to express your views on the content of the post -- I highly value opposing views, and I appreciate any reader taking the time to contribute them. But if you feel the need to direct a personal insult or attack at anyone, take it someplace else. It isn't welcome here.

"I'll just try to clarify more that when I said terrorist, see, I wanted to highlight the 'extrimist' charecter here. "

I probably won't be able to convince you that they I'm not an extremist. So arguing the point is a waste of time. My point is that it doesn't matter what I am - "extremist" or "not-extremist", because the issue isn't about me.

The issue relating to this blog entry is about companies who break the law and people who were punished for reporting it, as well as possible repercussions for breaking the law. Witnesses have alleged that Infosys broke the law and that they were punished for coming forward. If that is found to be true, there will likely be consequences and we have been discussing what that could be.

I'm just like everyone else here with a view, and I argue my point of view using the facts as I know them. I'm telling one perspective of many and people will have honest disagreement with my perspective.

Any point made about us as individuals is irrelevant. Points or critiques should be confined to the arguments we make directly relating to the subject at hand.

I know that you had some points to make on the matter, unrelating to me as an individual. If you want to talk about your those points directly relating to this blog entry, I'm happy to discuss with you. Frankly, I've lost track of the arguments made because the insults are a real distraction.

Assuming we are ready to "move on", here is some fodder on the subject at hand for debate.

1. I believe that if Infosys is found guilty of the criminal charges it will

a) Have a grave impact on Infosys

b) Have a serious impact on Indian firms that use the H-1b as a "business model"

c) Have a negative impact, but less serious, on American firms who will scapegoat Indian firms.

i. some of the scapegoating is deserved because Indian firms have abused the system more.

ii. American firms have done the same thing, but usually to a lesser magnitude. If you know of a case of especially egregious behavior by an American firm please say so.

d) New restrictions and laws will be passed as a result, impacting Indian firms the most followed by American staffing firms who will also see serious restrictions.

My hope is that the corporate sponsored visas will be abolished, that corporations will no longer be immigration middle-men, and that we shift focus on permanent immigration instead of temporary immigration - with economic safeguards for workers. I'm not convinced that will happen as a result of Infosys getting a conviction, but it could be a catalyst that starts a debate.

I hope Don would pose the question in a future blog - "why must their be corporate middle-men in the immigration process"? I would argue that the concept is fundamentally flawed, and that immigration should be an agreement between immigrant and nation and that motivation should be based on national interest, not corporate interest. I'm not arguing against immigration, rather I'm arguing about what our immigration goals should be, what motives we should value the most, and how it should be approached. Let's go back to square one and find our moral compass.

No you are good here. You did nothing wrong and I don't mind. So we are all set here.

I'll just try to clarify more that when I said terrorist, see, I wanted to highlight the 'extrimist' charecter here. You need not take "terrorist" as a bad word here - because that even a terrorist in his heart is thinking he is doing a noble cause. There are even 12 years old innocent terrorists also. There are many people in World calls US as gretest terrorists on earth but you call it fighting for your country's interest.

The words you should have concentrated more were "extrimist", "brainwashed" and not the 'terrorist'. However, as usual you were in your very best. If you feel better replace 'terrorist' with 'clergy' but do not lose adjectives on it.

Anyway did you notice your reply did not address the real questions at all?

These blog comments have followed the typical pattern that has surfaced when a scrutinizing or investigative blog entry about Indian outsourcing is published and the outsourcing supporters are faced with insurmountable arguments and logic: the outsourcing supporters will attempt to distract attention away from the subject at hand and attempt to devolve the discussion into personal attacks, etc.

Given its ubiquity, I sometimes think there is a classroom in some lobbying firm on K-Street in Washington D.C. where this distracting technique is taught to outsourcing supporters.

I think the biggest problem Indian outsourcing companies such as Infosys, Tata, Wipro, etc. are facing is that more and more American citizens (such as myself) are becoming informed and activated and are taking proactive steps to redress this significant issue with our federal, state and local government officials. We Americans hold the power to override any lobbyist and to remove any elected official that supports outsourcing from office. Those of us that are addressing this issue are not depending on the mainstream media to inform us (but are coming together at grass roots and other levels).

I think outsourcing companies such as Infosys are just one-half of the problem. The American-based companies (i.e., Microsoft, Bank of America, Accenture, Chase, Tampa Blue Cross/Blue Shield, etc.) that use Infosys and other Indian outsourcers are taking advantage of and using our U.S. tax-payer provided infrastructure (i.e., highways, police, fire, military, utilities, legal system, etc.) but are excluding highly qualified American IT professionals from the workplace.

These corporate "citizens" must also be held accountable and must be forced to roll back and reverse their current Indian staffing levels to a more acceptable level that represents the actual demographic diversity in the U.S. (i.e., its unacceptable in the U.S. for any IT department to consist of 90%+ Indian-born citizens).

Instead of waiting for the mainstream media to report on this significant problem, every American citizen should be writing to their elected officials and the CEOs of the companies that use Indian outsourcers and demand that they reverse these company's exclusionary and discriminatory hiring practices and begin to re-hire American citizens.

And very intersting how the Indian companies are all quoting European "slowdown" / "US Economy" as the reasons they are cutting expectations right now.

I am in Europe and am finding the contractors market is the healthiest I've seen for about 5 years now. Just passed up two contract offers in the last week and accepted a really good one today.

One of the "answers" touted by the article I linked to as well as the Indian "Hi-tech" companies is the use of vidioe conferencing. I worked at one major European bank that had such technology. It had to be booked, we headed to the room, it usually didn't work. The one time it did work, we spent the whole meeting marvelling at the technology and making faces at each other - it then broke doen and the meeting was over.

Projects without the offshore element work much smoother and cost a lot less money to complete as there is no need to try to make the process work when it doesn't ( at least from my 30 year of IT experience ).

Different than the first article which focused on flogging that dead offshore model horse. This one admits it's dead and pushes the ( more than just ) election year goal of putting America back to work.

India inc. had forecasrt double-digit salary increases this year. Good luck selling that kind of "quality" at any higher prices than they're selling it at already!

I'm no big fan of infosys and visa fraud but you guys are going overboard with your analysis. This blog seems to be the place where infosys haters come to roost. We've been hearing the same rehashed rants against outsourcing and offshoring since 2005. Guess what...life goes on.

Inspite of all you day dreamers predicting gloom and doom for infosys, they're still doing pretty good.

Phil, you are another dreamer. On one hand Infosys annouces that its business outlook is not rosy and is getting ahrd time from US clients, then it posts 30% rise in quarterly profits and now it announces single digit salary hikes for employees. Now these news items are so contrasting. Infosys clearly is a thug company. Showing inflated cash books to cover up losses - just as Satyam used to do.

something fishy. I was also with infy and was a tech arch but now I work as a senior engineer in a product company. I am happy with my work forget the salary component. I like the work i do and I take PTO whenever in need unlike the slavery like life. If you are in onsite for infy then every minute you pee in toilets counts as working hour but the limitless offshore calls .. (shhhh... no one cares to quantify those effort and appraise you). Simple reason I did not know whom to submit my performance appriasal form for year finally I had to submit it to the practise head whom i have never interacted wiht ... lol he told i need to improve in communication skill.. I showed my middle finger and walked out the hallway.

Infosys is probably a crappy company to work for but let's not hide for a minute that they are minting money. Infosys has always played conseravative in their outlook that's why investors haven't been purturbed.

Saurabh, Infosys is a crappy company for people who work in the offshore offices and for those who get transferred onsite from their offshore offices. But if someone joins Infy in the US , they can get Infy to accept their demands and it's far more different for a native Infosys person. I joined Infosys onsite. I don't do any work that requires and offshore team hence my work-life balance is pretty good (typical 9-5). I already know it's a crappy company for employees but they agreed to all my terms and work is interesting. I'm ready to quit this company the moment I feel that my interests are not being met. Use and dispose - that's how employees should see Infosys because that's how Infosys sees them.

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